Jones v Llanhennock Trust Partnership

[2020] NZHC 1971

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2020-419-53

[2020] NZHC 1971

BETWEEN

GREGORY JOHN JONES

Appellant

AND

LLANHENNOCK TRUST PARTNERSHIP

First Respondent

CAMBRIDGE VETERINARY SERVICES (1980) LIMITED

Second Respondent

VETERINARY PROFESSIONAL INSURANCE SOCIETY (INC)

Third Respondent

Hearing:

On the papers

Appearances:

Appellant in person

A Darroch for Second and Third Respondents

Judgment:

7 August 2020

FINAL JUDGMENT OF LANG J

[on costs]

This judgment was delivered by me on 7 August 2020 at 3.30 pm, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar Date……………

Solicitors:

Darroch Forrest, Wellington Copy to:

Appellant

JONES v LLANHENNOCK TRUST PARTNERSHIP [2020] NZHC 1971 [7 August 2020]

[1]    On 22 June 2020 I issued an interim judgment1 dismissing in all but one respect Mr Jones’s appeal against Judge Spear’s decision declining to require the two respondents to provide additional discovery.2 The remaining issue, which related only to the second respondent, Cambridge Veterinary Services (1980) Limited (CVS), was resolved in a minute issued on 27 July 2020.

[2]    In short, Mr Jones succeeded in one point advanced on the appeal. This related to documentary material held by CVS regarding the treatment of animals presenting with the same or similar symptoms as those exhibited by Mr Jones’s colt Adalia. CVS is to undertake further enquiries to locate any such documents once Mr Jones deposits the sum of $7,500 plus GST into Court by way of security for CVS’s costs in undertaking these enquiries.

[3]    It is now necessary to determine the appeal so far as it relates to the costs awarded against Mr Jones in the District Court and the costs payable on the present appeal.

Relevant principles

[4]    Mr Jones proceeds on the basis that the usual principles as to costs apply. To the forefront is the principle that the party who fails with respect to a proceeding should pay costs to the party who succeeds.3 Mr Jones submits he was the successful party on the present appeal. For that reason he should receive an award of costs in his favour in relation to the appeal and the costs awarded against him in the District Court should be set aside.

[5]    As Mr Darroch points out, however, the approach taken to costs is different in both the District Court and High Court when an application for discovery is made against a non-party. Rule 8.22(3) of both the District Court Rules 2014 and the High Court Rules 2016 provides as follows:

8.22     Costs of discovery

1      Jones v Llanhennock Trust Partnership [2020] NZHC 1409.

2      Llanhennock Trust Partnership v Jones [2019] NZDC 23729.

3      High Court Rules 2016, r 14.2(1)(a).

…

(3)If an order is made under rule 8.20(2) or 8.21(2),4  the Judge may,  if  the Judge thinks it just, order the applicant to pay to the person from whom discovery is sought the whole or part of that person's expenses (including solicitor and client costs) incurred in relation to the application and in complying with any order made on the application.

[6]    Although costs remain at the discretion of the Court, nevertheless the courts generally proceed on the basis that a non-party will be reimbursed on an indemnity basis for its reasonable costs in both responding to the application and complying with any order made as a result of it.5

Costs awarded in the District Court

[7]    In the District Court Judge Spear followed the usual approach and awarded costs to the respondents on an indemnity basis.6 These amounted to the sum of

$23,892.73, and related to the costs incurred by the respondents in attending the hearing in the District Court and complying with their discovery obligations.

[8]    I see no reason why the Judge was required to depart from the usual principle in the present case. The respondents complied with their discovery obligations and Mr Jones should be required to meet their reasonable costs in doing so. I therefore see no justification for disturbing the order for costs made in the District Court.

Costs on the appeal

[9]    Even applying the usual principles I do not consider it can be said that Mr Jones was the successful party on the appeal. His appeal failed completely against the first respondent and it failed on all but one ground against CVS.

[10]   The argument that I held to have merit related to a request for documents that the Judge regarded as amounting to a “fishing expedition”.7 Although CVS will now provide further information to Mr Jones as a result of the appeal I consider it was not

4      The initial order for non-party discovery in the present case was made under r 8.21(2).

5      Churchill Group Holdings Ltd v Aral Property Holdings Ltd HC Auckland CIV-2001-404-2301, 3 August 2005 at [33] and [36]; and Clear Communications Ltd v Telecom Corporation of New Zealand (1994) 8 PRNZ 200 (HC) at 202.

6      Jones v LLanhennock Trust Partnership, above n 2, at [17].

7 At [13].

unreasonable for CVS to argue that the documents Mr Jones sought were not relevant to his claim. Furthermore, significant issues as to the proportionality of the proposed discovery arose. It took considerable effort by all parties, including the Court, to finalise the extent to which CVS should be required to provide further discovery.

[11]   The fact that a non-party has unsuccessfully opposed an application for non- party discovery will in any event not necessarily disqualify it from being reimbursed for its reasonable costs. Mr Darroch has referred me to Smail v Restaurant Brand Properties Ltd, in which the respondents had unsuccessfully opposed an application for non-party discovery.8 The applicant contended the respondents should receive scale rather than indemnity costs because their argument based on relevance had failed. The applicant also contended the respondents were motivated by an improper consideration, namely trade competition. Neither argument succeeded. Justice Whata held that the respondents’ argument based on relevance was not unreasonable and the argument relating to trade competition highlighted the sensitivity of the information the applicant sought.9 The Judge therefore awarded the non-parties their reasonable costs on a solicitor/client basis.

[12]   I take the same approach in the present case. The actual costs incurred by the respondents amount to $11,437.33. Costs calculated on a category 2B basis amount to $10,994 after making allowance for steps taken following the hearing on 19 June 2020. This confirms the reasonableness of the costs the respondents have incurred by being required to respond to Mr Jones’s appeal.

Result

[13]The appeal against the costs awarded in the District Court is dismissed.

[14]   The respondents are entitled to a single award of costs on the appeal in the sum of $11,437.33.

[15]   Mr Darroch has also asked me to make an order requiring Mr Jones to pay the costs awarded in the District Court and in this Court. I am not sure whether there is

8      Smail v Restaurant Brand Properties Ltd [2020] NZHC 44.

9 At [4].

jurisdiction to make such an order. It seems to me that each award of costs is a judgment in its own right that may be executed against Mr Jones in any way the two respondents decide is appropriate.

Lang J